Mountain Ventures, Inc. is a retailer of outdoor adventure gear. The company began operations on February 7, 2019, also its date of incorporation and elected to be an S corporation. The company's Federal EIN is 58-2771998. The company's address is 1798 Snowy Spruce Circle, Dillsboro, NC 28725. The company's sole shareholder (100 shares) and president is Nikki Denny, 256-54- 4860, who lives at 652 Mountain Meadow Drive, Sylva, NC 28779. Ms. Denny oversees all of the store's operations, and spends approximately 35 - 45 hours per week at the store. The company's financial statements for 2021 reveal the following revenues & expenses: Sales Revenue $497,000 Short-Term Capital Gain 2,000 Returns & Allowances 6,100 Cost of Goods Sold Expenses: Officer Salary Other Salaries Payroll Taxes Rent Telephone Depreciation Liability Insurance Advertising 202,400 $ 60,000 105,000 14,750 19,000 15,500 10,064 4,800 8,120 10,000 Meals (not in a restaurant) Bad Debt Expenses Legal & Accounting Additionally, Nikki took $48,000 in shareholder distributions during the year. 590 4,000 The company owns the following assets: Date Acquired 04/02/19 06/02/20 04/12/21 08/02/21 Description of Asset Store Furniture & Fixtures Computer Equipment Telephone & Voice Mail System Computer Network Server & Hub Cost $27,000 $12,000 $22,600 $5,000 The company purchased 500 shares of Dell Computers on May 15, 2021 for $10,200, plus a $30 commission. These shares were sold on November 2, 2021 for $12,270, less a $40 commission (basis reported to IRS). The company uses straight-line depreciation for financial statement purposes. For tax purposes, the assets acquired in prior years were depreciated using MACRS 200% DB (NO Bonus or Sec. 179 was taken). The assets acquired during 2019 are depreciated over 7 years, and the assets acquired during 2020 are depreciated over 5 years. For the assets acquired during 2021, Nikki has instructed you to use the depreciation method(s) that result in the smallest tax liability for her. A comparative balance sheet for 2020 and 2021 is as follows: Account Cash Accounts Receivable Inventory Equipment & Furniture Accumulated Depreciation Accounts Payable Payroll Taxes Payable Sales Tax Payable 90 Day Bank Loan Loans from Shareholders Common Stock Retained Earnings 12/31/20 $27,000 700 39,050 39,000 (9,000) 39,700 7,655 1,050 -0- 6,000 100 42,245 12/31/21 $26,185 2,650 29,475 66,600 (19,064) 31,000 9,125 1,200 28,000 3,500 100 32,921 Project Requirements: 1. Prepare the corporation's 2021 Form 1120S, Form 1125-A, Schedule D (for Form 1120S), Form 8949 Schedule K-1 for the shareholder, Form 4562, and any supporting schedules that you feel are necessary Ms. Denny desire to pay the least amount of tax that she can legally pay. 2. Assuming that Ms. Denny is a single taxpayer with no dependents, received Economic Impact Payment of $1,400, and that she takes the standard deduction, calculate her 2021 income tax liability. Prepare a return for Ms. Denny, you'll need Form 1040, Schedule D, and Schedule E Mountain Ventures, Inc. is a retailer of outdoor adventure gear. The company began operations on February 7, 2019, also its date of incorporation and elected to be an S corporation. The company's Federal EIN is 58-2771998. The company's address is 1798 Snowy Spruce Circle, Dillsboro, NC 28725. The company's sole shareholder (100 shares) and president is Nikki Denny, 256-54- 4860, who lives at 652 Mountain Meadow Drive, Sylva, NC 28779. Ms. Denny oversees all of the store's operations, and spends approximately 35 - 45 hours per week at the store. The company's financial statements for 2021 reveal the following revenues & expenses: Sales Revenue $497,000 Short-Term Capital Gain 2,000 Returns & Allowances 6,100 Cost of Goods Sold Expenses: Officer Salary Other Salaries Payroll Taxes Rent Telephone Depreciation Liability Insurance Advertising 202,400 $ 60,000 105,000 14,750 19,000 15,500 10,064 4,800 8,120 10,000 Meals (not in a restaurant) Bad Debt Expenses Legal & Accounting Additionally, Nikki took $48,000 in shareholder distributions during the year. 590 4,000 The company owns the following assets: Date Acquired 04/02/19 06/02/20 04/12/21 08/02/21 Description of Asset Store Furniture & Fixtures Computer Equipment Telephone & Voice Mail System Computer Network Server & Hub Cost $27,000 $12,000 $22,600 $5,000 The company purchased 500 shares of Dell Computers on May 15, 2021 for $10,200, plus a $30 commission. These shares were sold on November 2, 2021 for $12,270, less a $40 commission (basis reported to IRS). The company uses straight-line depreciation for financial statement purposes. For tax purposes, the assets acquired in prior years were depreciated using MACRS 200% DB (NO Bonus or Sec. 179 was taken). The assets acquired during 2019 are depreciated over 7 years, and the assets acquired during 2020 are depreciated over 5 years. For the assets acquired during 2021, Nikki has instructed you to use the depreciation method(s) that result in the smallest tax liability for her. A comparative balance sheet for 2020 and 2021 is as follows: Account Cash Accounts Receivable Inventory Equipment & Furniture Accumulated Depreciation Accounts Payable Payroll Taxes Payable Sales Tax Payable 90 Day Bank Loan Loans from Shareholders Common Stock Retained Earnings 12/31/20 $27,000 700 39,050 39,000 (9,000) 39,700 7,655 1,050 -0- 6,000 100 42,245 12/31/21 $26,185 2,650 29,475 66,600 (19,064) 31,000 9,125 1,200 28,000 3,500 100 32,921 Project Requirements: 1. Prepare the corporation's 2021 Form 1120S, Form 1125-A, Schedule D (for Form 1120S), Form 8949 Schedule K-1 for the shareholder, Form 4562, and any supporting schedules that you feel are necessary Ms. Denny desire to pay the least amount of tax that she can legally pay. 2. Assuming that Ms. Denny is a single taxpayer with no dependents, received Economic Impact Payment of $1,400, and that she takes the standard deduction, calculate her 2021 income tax liability. Prepare a return for Ms. Denny, you'll need Form 1040, Schedule D, and Schedule E